Protectionism Won't Fuel a Nuclear Renaissance

Emergency funding legislation signed into law by the President
in September 2008 (Public Law No. 110-329) included a non-budget
amendment that will have a major impact on the United States'
energy market. Advanced by outgoing Senator Pete Domenici (R-NM),
the Domenici Amendment was intended to resolve a number of issues
that are complicating America's uranium enrichment markets.

The most important of these issues is concern over the economic
and national security implications of Russia's role as a stable
supplier of uranium (currently fueling about half of all U.S.
nuclear power reactors) at a time when the U.S. is potentially on
the threshold of a nuclear renaissance. Given Russia's behavior in
recent years, especially regarding Iran, Georgia, and NATO, these
concerns deserve close analysis.

While the Domenici Amendment attempts to bring predictability to
the marketplace, it does so at long-term expense to American
consumers. It cre­ates a bureaucracy-laden, protectionist
approach to accommodating U.S. demand for fuel that will likely
lead to higher energy prices, carves out specific mar­ket
access for suppliers, guarantees market protection for domestic
producers and certain suppliers (includ­ing the Russians), and
does little to enhance nonpro­liferation efforts. Moreover,
rather than depend on the open markets that allow utility companies
to buy fuel from the best, most reliable sources, the
amend­ment gives government bureaucrats the authority to manage
significant portions of the U.S. uranium enrichment market and,
perversely, will likely guar­antee America's continued
dependence on Russian uranium in the future.

The way to ensure that the U.S. can meet its nuclear energy
demand--without institutionalizing vulnerabilities to uncertain
suppliers and distorting markets--is to open the enriched uranium
market to competition.

The Domenici Amendment: Bad Policy and
Unintended Consequences

The American nuclear industry is undergoing a substantial
transformation as it prepares to meet America's growing demand for
clean, affordable, domestic energy. This new growth potential is
espe­cially pronounced in the uranium enrichment sec­tor.
The adjustments have resulted in increased uncertainty over the
long-term viability of the industry and have sparked both political
and orga­nizational resistance to change. Congress and the
Administration have made several attempts to help stabilize the
market. The latest policy solution is the Domenici Amendment, which
clarifies by which method and in what amount Russia can access the
U.S. market. Unfortunately, the details of the policy do more harm
to the American consumer than good. As a whole, the amendment:

Relies on the faulty assumption that price alone defines the
value of enriched uranium. The United States acquires about 20
percent of its electricity from nuclear power plants. These 104
plants are fueled by low-enriched ura­nium--about half of which
is imported from Russia as part of U.S.-Russian nonproliferation
agreements. These agreements will expire in December 2013, at which
time Russia would have enjoyed complete access to the U.S. market.
To avoid a flood of potentially cheap Russian enriched uranium that
would ostensibly under­mine the viability of domestic
enrichers, the Domenici Amendment limits Russia to supply­ing
only 20 percent of the U.S. market. The amendment, however, is
based on the misper­ception that the value of enrichment
services is based solely on price.

There is a benefit beyond price that consumers want and value. The
reliability of a supplier to fulfill contracted services is of
vital importance to utilities providing power to America's
house­holds and businesses. That is because at 5 per­cent,
enrichment costs are a small percentage of the total cost of
producing nuclear power.[1] When a plant loses over a million dollars
per day during shut-downs, it is more important to keep the utility
running than it is to save a nominal amount on fuel costs. Nuclear
power suppliers recognize that it is better to spend more for
enriched uranium from a reliable source than risk a break in
supplying power to its customers. Thus, U.S. utilities will be less
likely to purchase Russian enrichment services if that country is
behaving erratically or if it threatens to disrupt fuel
supplies.

Limits incentives to expand domestic enrich­ment
capacity to meet long-term demand. While the amendment does not
explicitly man­date that the U.S. obtain 20 percent of its
ura­nium from Russia, that will be the likely result-- which
will have long-term negative implications for U.S. energy supplies.
Based on Russia's past, potential suppliers assume that Russia will
fill the 20 percent limit with below-cost product, essen­tially
removing that portion of the market from competition. Once removed,
domestic suppliers have no incentive to pursue that share of the
mar­ket. This is exactly what is happening now. Two American
and two European companies are cur­rently planning to provide
enrichment services in the U.S. Upon the completion of their
projects, they will provide a quantity that is roughly
equiv­alent to 80 percent of the current U.S. market. This
means that the U.S. will be dependent on Russian uranium for a
minimum of 20 percent of its nuclear fuel. In other words, about 12
million Americans (or nearly 5 million households) will depend on
Russia to provide their electricity.[2]

Implies unnecessary market guarantees to domestic
suppliers. By limiting Russian imports, the government is signaling
that domestic sup­pliers will be protected from foreign
competi­tion. While the amendment purports to protect expanded
domestic enrichment, it does so at the expense of competition and
market-based prices. Moreover, it is unclear that such protections
are even necessary for domestic enrichers to be suc­cessful.
Four companies have already committed to constructing new
enrichment facilities in the U.S.--projects these companies have
deter­mined are feasible because of potential long-term demand
for enriched uranium, not because of the prospect of
government-imposed market guarantees. If these investments are
based on the latter case, the economic rationale for them
disappears. Enrichment companies should be forced to compete like
any other sector of the market, and if they are unable to do so,
they should be allowed to fail.

Places bureaucrats in charge of the market­place.
Instead of allowing trained uranium fuel managers to assess risk
and decide uranium pro­curement strategies for their firms, the
Domenici Amendment authorizes the federal government to manage
significant portions of the uranium market. It creates a
complicated set of condi­tions, requirements, reviews,
timelines, and authorities to decide who can supply what and to
whom it can be supplied. Nuclear power plant operators rely on fuel
managers who are respon­sible for scanning global uranium
suppliers for reliable, low-cost sources of fuel to support their
multibillion dollar operations. These managers are aware of the
market restrictions already in place and have the expertise to
decide how to best supply their companies with reliable sources of
uranium fuel. There is no need for govern­ment to intervene in
this facet of the industry.

Gives preferential market access to a privileged few
business and U.S. government consumers. Given that one of the
stated justifications for gov­ernment control of America's
uranium enrichment market is to avoid becoming too dependent on any
one supplier (for example, Russia), it seems coun­terproductive
to place limits on one sector while simultaneously lifting limits
on others. The amendment defines three exceptions to the limits
under which enriched uranium could be imported in any amount, from
any source: 1) to fuel new reactor cores, 2) as an input for
processing and re-export, and 3) to augment inventory held by the
U.S. Department of Energy.

Thus, the amendment limits uranium supplies to the existing
commercial electricity sector (for example, everyday consumers),
while big busi­ness and the U.S. government will be allowed to
scour the global marketplace to retain their enrichment services
from the best supplier at the best price. Because this
command-and-control approach to regulating the industry establishes
a risk-averse status quo where investors only invest to meet
guaranteed market demand, growing demand in the commercial market
will likely require increasing America's reliance on Russian
uranium. The amendment recognizes this very outcome, which is
exactly why it pro­vides so many opportunities to adjust the
quota and relieves special interests from quota restric­tions
altogether.

Accomplishes little to advance nonprolifer­ation.
The Domenici Amendment is also sup­posed to entice the Russians
to convert additional weapons-grade uranium for use in commercial
reactors. The amendment com­mendably supports the current
policy of con­verting 500 metric tons of Russian weapons-grade
uranium for use in commercial reactors by the end of 2013. It also
attempts to compel the Russians to continue their weapons-grade
ura­nium conversion activities after 2013.

While the United States should express its strong desire that
converted weapons-grade uranium continue to make up a portion of
Russia's exports to the U.S., the incentives the amendment
estab­lishes to entice Russian participation are small and not
likely to be effective. While the law would carve out another 5
percent of the American ura­nium fuel market for Russia if it
agreed to convert another 300 tons of weapons-grade uranium,
Rus­sia can instead sell the same amount or more to other
countries without facing the same condi­tions. By creating a
solution that is not likely to work, the amendment diverts
attention away from developing a more practical program.

Market Access Does Not Imply
Dependence

It is critical that U.S. policymakers not lose sight of the
distinction between having access to a par­ticular supplier and
becoming dependent on it. Eliminating America's dependence on
Russian enrichment services is a desirable goal, but doing so
should not sacrifice all of America's access to those resources.
American utilities could choose to include some Russian enriched
uranium as part of a diversified supply portfolio without becoming
dependent on Russian suppliers. Indeed, most large nuclear
utilities already implement a diversified supply strategy as a
matter of company policy.

Any reform of America's uranium enrichment import/export policy
must take this delicate balance into consideration. If America's
relationship with Rus­sia continues to degenerate and a
determination is made to impose punitive action against Russia,
con­trols on the uranium trade could be part of any
result­ing sanctions regime. While such a policy approach would
result in eliminating America's dependence on Russian fuel
suppliers, it would also remove a specific source of supply from
American businesses and con­sumers. Regardless of whether
sanctions would suc­cessfully motivate Russia to behave
responsibly, there would be negative economic consequences that
must be weighed against any foreign policy benefits stem­ming
from economic sanctions.

Nuclear Power and Uranium Enrichment
in America

The federal government heavily promoted nuclear power throughout
the 1950s and 1960s. It realized that a robust commercial nuclear
sector would help to support its national security objec­tives.
The federal government worked with industry on a host of military,
civil, and commercial projects throughout that period. It provided
lucrative guar­anteed contracts and other subsidies that
protected investments and assured private-sector access to the latest nuclear technology.

Although the industry grew, it became depen­dent on
government. This left it vulnerable to shifts in public policy.
When policy shifted toward out­right opposition as the activist
community con­vinced America's political left that nuclear
power was dangerous, the industry predictably failed as investors,
cut their losses, and moved capital to opportunities that were
perceived as less threatened by increasing regulatory
volatility.

A handful of companies survived and today make up America's
nuclear industrial base. This includes those in the uranium
enrichment business. Only one domestic company enriches uranium in
the U.S. This company, USEC, was created in the 1990s to privatize
and restructure America's enrichment com­plex, which was built
to primarily support national security activities, not commercial
enterprise.

USEC became a private company in 1998. The problem for USEC is
that it was forced to compete in the commercial world with a Cold
War national security infrastructure. It uses an outdated,
expen­sive, and inefficient process of gaseous diffusion to
enrich uranium--a production process that is financially
unsustainable and has led USEC to engage in an ongoing
modernization process. Its future hinges on using the more modern
technology of gas centrifuges to enrich uranium.

Enriched Uranium: Supply and Demand
Realities Today and Tomorrow

The capacity to enrich uranium is measured in separative work
units, or SWU (the measurement of energy needed to separate U-235
from U-238).[3] While a few countries, such as Japan and
China, have some enrichment capacity, most global demand is met by
USEC, two European consortiums, and Russia. Total global SWU
capacity is approximately 52 million, although national policies
limit available capacity to about 43 million SWU.[4]

The United States currently requires about 14.4 million SWU
annually to fuel its reactors.[5] About half of this amount is
supplied by Russia under the Megatons to Megawatts program, which
ends in 2013. The other half is supplied by domestic and European
sources: USEC, Eurodif (France), and Urenco (UK, Germany, and the
Netherlands).

The four companies planning to provide enrich­ment services
in the U.S. already have two projects-- one in New Mexico and one
in Ohio--under con­struction. Total U.S. SWU capacity will be
about 11 million SWU once the four planned facilities become
operational.[6] However, given that two of the new
facilities are based on technology that has yet to be commercially
proven, the projected domestic capacity of 11 million SWU is
uncertain.

Both the lack of domestic suppliers and the poten­tial for
future growth have attracted new investment in U.S. uranium
enrichment capacity. The investment was made, however, under the
assumption that the U.S. would limit the share of America's
enriched uranium market available for Russia, as current U.S.
government policy would suggest.

This assumption, however, began to unwind when recent court
decisions overturned the legal foundation allowing the U.S. to
restrict Russian suppliers. With mounting legal uncertainty over
the terms of Russia's future market access in America, Congress and
the Administration faced a compli­cated policy conundrum: how
to best assure reliable access to enriched uranium for power
producers today and in the future. The Domenici Amendment was one
such remedy.

An Agreement with Russia

In 1991, U.S. uranium miners and a uranium enrichment labor
union accused Russia of dumping enriched uranium on the U.S.
market.[7] This insti­gated a Department of
Commerce investigation into Russian trade in enriched uranium that
could have resulted in additional duties on nuclear fuel imports.
Instead, the U.S. and Russia signed a "Sus­pension Agreement"
in 1992 that sought to define the conditions under which Russia
could have access to the U.S. market. A critical provision of the
agreement was one that lifted all restrictions on the import of any
low-enriched uranium (LEU) so long as it used Russian, bomb-grade
high-enriched ura­nium (HEU) as its feedstock.

This provision was executed as part of a program between the
U.S. and Russia often referred to as Megatons to Megawatts. This
highly successful pro­gram served two critical purposes: It
removed weap­ons-grade HEU from the Russian arsenal and it
provided the U.S. with a reliable source of fuel for its power
reactors. Russia supplies fuel for about 10 percent of America's
electricity through this pro­gram. The HEU agreement was set to
last 20 years-- during which time 500 metric tons of Russian HEU
would be down-blended into nuclear fuel.[8]

With the expiration of Megatons to Megawatts on the horizon, the
U.S. government has worked with Russia to amend the suspension
agreement to develop new terms for Russian access to the U.S.
market. Despite the fact that U.S. relations with Russia have
deteriorated since the early 1990s when the original Suspension
Agreement was signed, the agreement was amended in February 2008
and determined that Russia would be allowed to supply up to 20
percent of America's nuclear fuel between 2014 and 2020.[9] But a
recent court decision undermined the applicability, and thus
legitimacy, of this policy approach to controlling imports of
Russian uranium.

Restricting Trade in Enriched Uranium:
The Legal Question

Russia has not been the only nuclear fuel sup­plier to face
U.S. anti-dumping actions. A separate anti-dumping action was taken
against European Gaseous Diffusion Uranium Enrichment
Consor­tium, or Eurodif. Eurodif appealed the decision through
the U.S. Court of International Trade and the Federal Circuit Court
of Appeals. Both courts ruled that the process of enriching uranium
was not subject to U.S. anti-dumping law because it repre­sents
the sale of a service, rather than a good. This decision undermined
the basis for the U.S.-Russian Suspension Agreement and set in
motion much of the controversy that exists today. The Supreme Court
is currently reviewing the decision.

U.S. utilities have two ways to import enriched uranium. They
may either purchase already en­riched uranium or they can
provide uranium feed­stock[10] and have it enriched. In
the second case, the utility would arrange for the feedstock to be
delivered to a foreign enricher who then delivers uranium enriched
from its own inventory. Com­pensation for the transaction
includes transfer­ring title of the delivered feedstock to the
enricher as well as payment for the enrichment service. This
arrangement is referred to as a SWU or enrich­ment
contract.

Because the U.S. utilities retain title to the feed­stock
uranium until they receive LEU from the enricher, the Federal
Circuit Court found that there was no transfer of ownership, and
thus no "sale," of the LEU from the enricher, in this case Eurodif,
to the U.S. utilities, but only a "service." Thus, since no sale of
merchandise occurred, the court ruled that anti-dumping laws did
not apply.[11]

That decision, if affirmed by the Supreme Court, will nullify
the newly amended U.S.-Russia Sus­pension Agreement. While that
agreement stated that Russia could supply up to 20 percent of
Amer­ica's enriched uranium, it would do nothing to
pro­hibit Russia from supplying unlimited enrichment services,
thus undermining the agreement's real-world credibility. The
Domenici Amendment up­held the application of the amended
suspension agreement by clarifying that any imported Russian
uranium, regardless of contract type, would be con­sidered part
of the 20 percent quota.

The problem is that the Domenici Amendment upheld bad policy.
The reality is that the amended Suspension Agreement was initially
an inappropri­ate agreement because it artificially limited
free trade and access to global energy resources. With the
potential new expansion of the U.S. nuclear power industry,
attempting to forecast future demand and determine market share for
particular suppliers is fraught with uncertainty and is
poten­tially costly for all stakeholders.

Russia's Impact on Uranium Markets

Russia will have a total of about 26 million SWU by 2010, but a
domesticrequirement of only about 8 million SWU at home.[12]
This will leave about 18 million SWU for the Russians to offer on
the global market at potentially low prices. Investors in U.S.
enrichment capacity worry that open competition with Russia would
result in low fuel prices--too low to bring a return on their
multibillion dollar investments.

Global trends toward increasing the production of commercial
nuclear power, however, should ren­der this concern moot.
India, China, Japan, the United Kingdom, and many other countries
are all planning to build nuclear power plants in the years ahead.
Russia also plans to build additional nuclear power plants, which
means its own demand for enriched uranium will increase. The level
of future demand is unclear; however, what is clear is that global
demand will grow significantly in the future.

In 2007, then-President Vladimir Putin commit­ted to roughly
doubling Russia's nuclear power. Should this plan be realized, its
18 million excess SWU capacity quickly halves to about 10 million
SWU, assuming that it supplies all of its own enrichment. In
addition, Russia plans to export up to 60 nuclear power plants to
other countries over the next 25 years.[13] Assuming that some, if not
most, of these plants will include service agree­ments with
fuel, most of Russia's excess capacity will be used as the global
nuclear renaissance unfolds.

A caveat to this analysis, however, is the financial crisis that
is currently gripping the global economy. This could affect many
nations' plans to build new power generation, including nuclear
energy. Should market conditions dictate that new power
genera­tion is either not needed or not required, the above
calculations would clearly require revision. That is precisely why
the U.S. should pursue market-based policies regarding energy. A
well-grounded, market-based system will be flexible enough to
respond to changing conditions. On the other hand, a more
state-centric system, like that promoted in Russia, will be
unsustainable.

Protectionism Does Not Bolster
National Security

Reducing American dependence on foreign energy has been at the
heart of the energy debate in recent years. But dependence on
foreign sources of energy is not the problem. The problem arises
when reliance on unstable or hostile foreign sources of energy
creates unacceptable and unmanageable economic and strategic
vulnerabilities. The fear that less expensive supplies of foreign
nuclear fuel will drive out domestic production and leave America
at the mercy of a foreign regime certainly plays on this argument,
and seemingly provides justification for restrictions on foreign
suppliers. In the case of ura­nium fuel, however, cost is not
the most important factor. Because it represents such a small
percentage of the total cost of nuclear electricity and the losses
associated with shutdowns are so high, supply reli­ability is
more important than cost.

U.S. national security also depends on policies that promote the
country's economic well-being. The correct policy will consider the
likelihood of becoming dependent on questionable foreign
sup­pliers, like the Russians, and the likelihood that such a
country would threaten the U.S. with supply inter­ruptions, and
also the cost of denying Americans access to foreign uranium
enrichment resources.

Additionally, there are national security implica­tions for
not using a domestic supplier of enriched uranium for defense
purposes. The United States relies on assured supplies of uranium
for some of the most critical defense activities. While it is true
that the U.S. must maintain domestic enrichment capacity for
military use, the cost of maintaining this capability should not
fall on U.S. nuclear power utilities and their customers. If
domestic suppliers catering to defense demand cannot compete in
commercial markets, then the needed capability should be budgeted
and paid for through national security budgets.

What to Do

To ensure that the U.S. can meet its nuclear energy demand
without creating unacceptable vul­nerabilities or distorting
markets, Congress should repeal the Domenici Amendment. Congress
and the Administration should also:

Reject calls to reassert protectionist policies. The
Federal Circuit Court ruled that uranium enrichment is a service
and, therefore, not subject to U.S. anti-dumping law. Overturning
this deci­sion with legislation--precisely as the Domenici
Amendment accomplished--in addition to being bad policy could open
the door to a signifi­cant expansion of retaliatory trade
remedies as a means to solve problems better addressed through
other mechanisms.

Recommend that utilities diversify sources of fuel
supply. While the U.S. should neither fear foreign competition
nor deny U.S. ratepayers access to inexpensive enrichment services,
Russia has demonstrated a willingness to use energy dependence as
political leverage against other countries. Consequently, the risk
that Russia could apply the same pressure on the U.S. cannot be
ignored. Instead, U.S. policy should look to the current best
practices that many utilities have already adopted to protect
themselves from rely­ing on a single supply source. Strongly
recom­mending that power providers diversify their sources for
enriched uranium--with no dis­crimination by country--would
effectively limit America's reliance on any single foreign
producer. Such an approach would promote market stabil­ity and
provide the long-term flexibility that util­ities in a robust
and diverse marketplace require.

Create a uranium supply-disruption mitiga­tion
reserve. The U.S. Department of Energy controls large amounts
of uranium that is not needed for national security purposes.[14]
The Energy Department should undergo an audit to account for this
uranium. Once established, this resource could be used to set up a
temporary reserve. If any foreign supplier attempted to use its
market power as leverage to achieve a political agenda, the U.S.
could use this uranium to satisfy demand requirements during a
transition period to more reliable suppliers. As the nuclear
renais­sance unfolds, this uranium could be released on the
open market in the future.

Pursue government-to-government talks to achieve
nonproliferation objectives. The achieve­ments of the
U.S.-Russian efforts to remove weapons-grade uranium from Russia
cannot be overstated and should be continued. Unfortu­nately,
the approach in the Domenici Amendment is not likely to advance
this effort. Instead, the U.S. and Russian governments should
engage in talks to develop a plan with a better chance of
success.

Work to achieve global open markets. Foreign markets are
heavily protected against U.S. and other foreign sources of
competition in the nuclear power and related industries. Freer
trade not only makes sense for the U.S., it also makes sense around
the world--especially with the global drive to diversify
alternative sources of energy. The U.S. government should work
through the World Trade Organization and directly with other
countries to help reduce bar­riers to trade, thereby promoting
competition and reducing market distortions.

Assure adequate enrichment capabilities for de­fense
purposes. The United States must have assured supplies of domestic
enrichment to meet defense needs. If U.S. suppliers of enrichment
services can­not competitively meet defense requirements in an
open market, provisions to maintain their opera­tion should be
made through the defense budget rather than through protectionist
policies.

Conclusion

America needs a reliable supply of enriched ura­nium to
bring a nuclear renaissance to fruition and diversify the sources
of energy the U.S. needs for its long-term economic growth and
security. For more than 20 years, the U.S. has relied on
protectionist policies to enforce guaranteed supply. It is time for
the U.S. to embrace market-friendly policies to assure
supply--reliably and efficiently--in the future.

Jack Spencer is Research Fellow in Nuclear Energy in the
Thomas A. Roe Institute for Economic Policy Studies, and Daniella
Markheim is Jay Van Andel Senior Trade Policy Analyst in the Center
for International Trade and Economics, at The Heritage
Foundation.

[2]The
U.S. currently receives 50 percent of its uranium from Russia,
which is equivalent to 10 percent of America's electricity. Twenty
percent of Russian uranium would be equivalent to 4 percent of U.S.
electricity. Four percent of the total U.S. population of 305
million is equal to approximately 12.2 million people.

[3]In
its natural state, uranium consists of several isotopes. The
isotope needed to conduct fission--the process that creates the
heat necessary to produce power--is uranium-235 (U-235) and makes
up 0.7 percent of naturally occurring uranium. The remainder is
primarily uranium-238 (U-238), which alone cannot fuel U.S. power
reactors. However, for fission to be sustained in U.S. light-water
reactors, the uranium fuel must consist of approximately 3 percent
to 5 percent U-235. To reach this level, natural uranium must be
enriched.

[7]"Dumping" occurs when imported goods are sold
in the U.S. market at less than the price of similar goods sold in
the producer's home market or less than the cost of producing the
goods. If these "dumped" goods are determined to cause material
injury to U.S. domestic industry, they are subject to additional
duties equivalent to the amount of the dumping margin.

[10]Feedstock is natural uranium in the form of
uranium hexiflouride, which is natural uranium mixed with fluorine.
It can be stored as a solid but turns to gas when heated, which is
its state during enrichment.

Share

Expansion of nuclear power will result in increased demand foruranium. Growing fuel markets will create the environment that cansustain new enrichment capacity; artificially protecting domesticsuppliers will not. The U.S. needs a domestic supplier of enricheduranium for national security purposes. The U.S. and Russia mustcontinue to convert Russian weapons-grade uranium for use inpeaceful power reactors.

Key Points

2 Overturning inconvenient legal decisions with
protectionist legislation does not advance U.S.
interests. Instead, Congress should develop
policy remedies that respect the authority of
the courts. Not doing so undermines the rule
of law on which America’s system of governance
depends.

3 Expansion of nuclear power will result in
increased demand for uranium. Growing fuel
markets will create the environment that can
sustain new enrichment capacity; artificially
protecting domestic suppliers will not.

4 The U.S. needs a domestic supplier of
enriched uranium for national security purposes.
If not commercially viable, uranium
should be subsidized through national security
budgets, not through electricity premiums.

5 The U.S. and Russia must continue to convert
Russian weapons-grade uranium for use in
peaceful power reactors. This program should
be separate from commercial activities.

Key Points

Overturning inconvenient legal decisions with
protectionist legislation does not advance U.S.
interests. Instead, Congress should develop
policy remedies that respect the authority of
the courts. Not doing so undermines the rule
of law on which America’s system of governance
depends.

Expansion of nuclear power will result in
increased demand for uranium. Growing fuel
markets will create the environment that can
sustain new enrichment capacity; artificially
protecting domestic suppliers will not.

The U.S. needs a domestic supplier of
enriched uranium for national security purposes.
If not commercially viable, uranium
should be subsidized through national security
budgets, not through electricity premiums.

The U.S. and Russia must continue to convert
Russian weapons-grade uranium for use in
peaceful power reactors. This program should
be separate from commercial activities.

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